While retirement might be something we all look forward to, during economically challenging times such as now, it can be difficult to continue living on a fixed income without missing payments, sacrificing needs and wants, or having to begin working again.

According to a 2023 study, retirees have an average of $70,000+ in debt for their mortgage, student loans, car loan and credit cards. Spring is not only the perfect time to clean your house and garden, but also update your household budget. Here are five ways to spring clean your retirement budget.

Review Income and Expenses
The first step is to review and analyze your retirement budget including your current income and expenses. Review your income and expenses line by line. Compare your first quarter 2023 income and expenses (January 1 to March 31, 2023) to your income and expenses for the first quarter of 2024 (January 1 to March 31, 2024). Chances are, given the inflation environment we have experienced, you may need to make some lifestyle adjustments for the remainder of 2024 which you would much rather figure out sooner rather than later. Give yourself some leeway in calculating your monthly expenses and how much you’re spending each month. It is important given the last two years of high inflation and interest rates.

Essential vs. Non-essential Expenses
The next thing you need to do is to review what you consider essential versus non-essential expenses, aka needs versus wants! How much of your monthly spending is discretionary as compared to necessary expenses? How much could you save making more meals at home? Could you cut back on your entertainment expenses and look for more, free and/or senior discount things to do around town? Budgeting for your housing repairs, health care (particularly medications), transportation and food are the priority expenses not to mention essential, so be sure you’ve allocated enough for your essentials before budgeting for discretionary expenses.

Take Advantage of Discounts
Whether you’re an AARP member, a member of the Association of Mature American Citizens, or simply want to enjoy a discounted meal at your favorite restaurant from the 55+ menu, taking advantage of senior discounts whenever and wherever you can, is a great way to save money and still do the things you like. Don’t forget to enjoy the retirement stage of life – you’ve earned it! Check out free activities at your local community center, save money on traveling, and some pharmacies even offer prescription card discounts on certain medications. You’d be amazed at the money you can save by searching for deals.

Consolidate Your Debts
A November 2022 Lending Tree survey found that around 65% of credit card holders don’t pay off their credit cards monthly and carry debt from month to month. Given inflation and the high interest rate environment we are experiencing, many people are barely able to make the minimum monthly payment. If you have a lot of credit card debt and other loans that you’re struggling to make payments on, consolidate the credit card debt into one credit card with the lowest interest rate possible (pay attention to the fine print for those teaser rates), so you can factor in paying down this debt each month and don’t have any unexpected surprises when your bill comes in. This can give you peace of mind, and help you set a goal. If you have time before retirement, try setting aside extra money each month to pay down more debt than the minimum that’s due so you can get the mountain of debt down before you retire.

Pay Off Big Debts
If you have high floating rates or fixed rates of interest on any of your debt obligations such as your auto loan, credit cards, private student loans, or mortgage, shop around and see if you can get a lower rate. Make sure you are paying by ACH since most banks will reduce your interest rate 25 basis points or more. Paying this way may also increase your credit score since you will not have any delinquent payments. You should see an increase in your credit score which could put you in a better credit score category that will get you a lower interest rate. If you still have Federal student loan debt that you are repaying for your education or for one of your children or grandchildren, go to www.studentaid.gov to see what Income-Driven Repayment Plan works best for you to lower your monthly payment.

Good luck!